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Rogue landlord fined for health and safety breach

Published On: July 27, 2016 at 11:02 am

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Another landlord has been handed a substantial fine after refusing to adhere to an improvement notice on his property.

Sunderland Magistrates’ Court issued a fine to Joseph Benedikt, after repeatedly refusing to carry out improvements on his cold and damp property in Chardmore Road, London.

Fines

Benedikt was given a fine of £2,000, told to pay £998 in costs and a £200 victim surcharge as a result of his negligence.

This hearing followed a previous guilty plea to further non-compliance with an Improvement Notice, relating to a different property in Corporation Road, Hendon, Sunderland. Mr Benedikt left the property in a poor state of repair, despite receiving a schedule of works from Sunderland City Council’s private housing team.

The property was found to have:

  • structural damage
  • inadequate heating
  • no insulation
  • damp
  • mould

As a result, conditions in the property were found to pose a serious health risk to the pregnant teen and her two children residing there. Despite this, Benedikt refused to bring the property up to acceptable standards.

Rogue landlord fined for health and safety breach

Rogue landlord fined for health and safety breach

Enforcement

Councillor Graeme Miller observed, ‘this prosecution is a demonstration of our willingness to take enforcement action against landlords whose rental properties fail to meet the required standards and a reminder of what can happen if they fail to meet their legal responsibilities.’[1]

‘It also shows what an important part the selective licensing scheme played in beginning the continuing process to improve private rented properties in Hendon, Miller added.[1]

Concluding, he said, ‘we always strive to work in partnership with private landlords and encourage them to join the accredited landlords’ scheme. We can achieve so much more by providing people with standards of rented accommodation they deserve and landlords with the type of tenants who will respect their properties and contribute to the communities that they’re living in.’[1]

[1] https://www.landlordtoday.co.uk/breaking-news/2016/7/landlord-who-put-young-familys-health-and-safety-at-risk-fined

Mortgage Approvals Drop to 15-Month Low in Brexit Month

Published On: July 27, 2016 at 10:59 am

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Mortgage approvals dropped to a 15-month low in June amid concerns over the Brexit vote, according to figures from the British Bankers’ Association (BBA).

Mortgage Approvals Drop to 15-Month Low in Brexit Month

Mortgage Approvals Drop to 15-Month Low in Brexit Month

Data from the trade body shows that mortgage approvals for house purchase fell from 41,842 in May to 40,103 in June, while net lending dropped from £1.6 billion to £1.3 billion over the same period.

On an annual basis, the number of approvals is 11% lower. However, in the first half of the year, approvals were 5.5% higher than in the same period of 2015.

Although the number of mortgage approvals was down, the total value of loans was up, with gross mortgage borrowing of £12.2 billion in June, up by 4% on the same month last year. Borrowing for the first six months of 2016 totalled £79.9 billion, which is up on the £63.6 billion recorded in the same period of 2015.

The Chief Economist at the BBA, Dr. Rebecca Harding, comments: “This month’s high street banking data reflects the uncertainty that was felt ahead of the EU referendum. Business borrowing in June dropped for the first time in 2016, signalling that investment decisions were being delayed until after the vote.

“Mortgage lending and approvals also fell back in June, but remain above the low levels seen in April following the introduction of the Stamp Duty surcharge.”

Andrew McPhillips, the Chief Economist at Yorkshire Building Society, also responds to the data: “These figures show that homebuyers chose not to postpone getting on the housing ladder, despite uncertainty around the EU referendum. That said, it’s important to note that increases in lending are not solely influenced by movements in demand, but also by house prices.

“Current levels of house price inflation are putting upwards pressure on the size of the loans people are taking out, which is, in turn, driving up mortgage lending. There was a 4.9% monthly increase in property transactions in June, according to HMRC, and the fact that lending is increasing on a much steeper scale shows how house price increases are affecting the mortgage market.”

He continues: “Looking at the long-term trends, property transactions are actually down by 10.2% on last year, compared with a 4% increase in lending over the same period. The consequence of increasing house prices is that many people are being pushed out of the market due to the amount of money required to get on the property ladder.

“There is a clear need for more homes to be built, which should act to reduce house price inflation and help to make homes more affordable.”

Positively, however, the latest figures from housebuilder Taylor Wimpey show that customer interest in new homes remains strong, despite uncertainty surrounding the Brexit vote. If the firm continues to build homes at the current rate, housing supply should increase significantly, relieving the pressure on the property market.

Customer Interest High Despite Referendum, Reports Housebuilder

Published On: July 27, 2016 at 9:39 am

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In its latest half-year report, housebuilder Taylor Wimpey claims that customer interest continues to be high, despite last month’s EU referendum.

In the first six months of 2016, the builder completed a total of 6,019 homes, up by 3% on the same period last year.

Its average selling price was also up, by 5.8%, to £238,000.

Looking ahead, Taylor Wimpey reports that it has a strong order book for the future, representing 8,683 new homes.

Customer Interest High Despite Referendum, Reports Housebuilder

Customer Interest High Despite Referendum, Reports Housebuilder

The report found that although it is too early to assess the long-term effects of the EU referendum result, there has been no meaningful change to the housebuilder’s business to date, with trading in the past month at a normal seasonal range.

Since 24th June (the date the referendum result was announced), the early confidence indicators amongst homebuyers, alongside continued competitive lending by mortgage providers, are encouraging the resilience of the UK housing market.

Taylor Wimpey has also found that the Help to Buy scheme continues to be a differentiator for new build housing, and remains popular with its customers.

Positively, the housebuilder reports that commentary over the last month from the Government, Bank of England and mortgage lenders demonstrates a commitment to housing supply and recognition that there remains a fundamental imbalance between demand and supply.

Additionally, customer interest from Taylor Wimpey remains high, with website visits solid, and customers continuing to register interest in forthcoming developments and make appointments to progress their home purchases. Although the builder experienced a small increase in the average cancellation rate immediately after the referendum, this remained low compared to historic norms and is now back in line with recent low levels.

However, it’s not good news for the prime central London market, where demand has continued to slow. Despite this, the wider London market remains robust.

Taylor Wimpey insists that through focusing on creating long-term value and mitigating future risk, it delivers on providing homes in the right location, which is a “key determinant of a home purchase”. It is currently operating from 286 locations across the country, in villages, towns and cities “where people want to live”.

As a result, the housebuilder believes that it will continue to perform well throughout all market conditions.

The Chief Executive of Taylor Wimpey, Pete Redfern, comments: “We have delivered a strong operational and financial performance, with continued growth in profitability, building over 6,000 new homes across the country during the first half of 2016.

“One month on from the EU referendum, current trading remains in line with normal seasonal patterns. Customer interest continues to be high, with a good level of visitors both to our developments and to our website. We are monitoring customer confidence closely across a number of metrics, including appointment bookings, and these continue to be solid. Whilst it is still too early to assess what the longer-term impact from the referendum result on the housing market may be, we are encouraged by the first month’s trading and by continued competitive lending from the mortgage providers, as well as the positive commentary from Government and policymakers.”

If confidence in the housing market continues, will the demand and supply imbalance be corrected?

More people of retirement age looking to rent

Published On: July 27, 2016 at 9:38 am

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A new survey has revealed that there has been a sizeable increase in the number of people looking to rent a property during their retirement years.

Retirement rentals specialists Girlings Retirement Rentals believe more pensioners are looking to rent during their later years due to the benefits that renting brings.

Investment

The firm reports that a larger number of older people are seeking to downsize and subsequently sell their homes in order to rent. This enables them to release capital and use this to invest in their future.

Peter Girling, chairman of Girling Retirement Rentals, said, ‘retirement is a fresh start and a chance for people to move somewhere they’ve always dreamed of living. People come to us because we offer apartments on assured tenancies enabling them to stay as long as they want and not worry about having to leave until they chose to. Renting also frees them up from the financial burden of property ownership and maintenance, which can be a worry in later life.’[1]

In addition, the National Landlords Association reports that the number of private renters in the UK has risen by 13% since 2012 to hit roughly 220,000.

More people of retirement age looking to rent

More people of retirement age looking to rent

Hotspots

Girling Retirement states that top hotspots tend to be in seaside locations towards the south of England. Typically, these regions offer the best weather and a better quality of life.

According to Girling Retirement, the top ten most popular places to rent a property in later life are:

  • Bournemouth
  • Poole
  • Ferndown
  • Brighton
  • Weymouth
  • Bristol
  • Clevedon
  • Great Yarmouth
  • Paignton
  • Reading

[1] https://www.landlordtoday.co.uk/breaking-news/2016/7/sharp-rise-in-retirement-rentals

 

 

Call for extra funding for building additional homes to rent

Published On: July 27, 2016 at 8:56 am

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The new UK housing minister Gavin Barwell has been urged by property peers to pledge his support to funding for building of new homes to rent. Observers feel that this can be achieved by relaxing the rules around public funding in the sector.

This appeal has been driven in response to a report published this week by the Centre for Economic and Business Research. Commissioned by the National Housing Federation, the report suggests that the UK economy could contract by £145 million during the next decade, should the rate of new housing completions drop at the levels seen in 2008.

Austerity

Figures from both the National Housing Federation and the Chartered Institute of Housing believe that more homes for rent would keep both housebuilding and the economy buoyant in times of austerity.

The National Housing Federation has predicted that 300,000 units could be built by housing associations by the year 2020, if funding is made available.

These calls from sector bodies is likely to be welcomed by would-be tenants, with demand continuing to massively outstrip supply.

Budgeting

A reallocation of the central budget to ultimately allow housing associations to build more rental homes would negate the effects of a slowdown in the housebuilding sector, according to James Howard, partner in Clarke Willmott LLP’s social housing development scheme.

Howard said, ‘a change in funding strategy to switch the balance to building more for rent than for sale should allow for a supply of new homes to continue despite the gap private sector housebuilders might leave behind.’[1]

Jonathan Hulley, Clarke Willmott’s head of housing and asset management, believes the Government’s Starter Homes scheme could undermine sales of more affordable shared ownership properties.

Hulley noted, ‘the social housing sector argues that housebuilding is needed now more than ever. People are in need, waiting lists are still growing, so the policy of building more homes for sale only needs to be revised and adapted to allow for the building of more homes for rent.’[1]

Call for extra funding for building additional homes to rent

Call for extra funding for building additional homes to rent

Lack of capacity

Mr Hulley went on to say, ‘there is also worrying lack of capacity on the ground to deliver which needs to be addressed and a question mark over what appetite there is for outright purchase of house on large scale.’

‘On the other hand the kind of shared ownership offered by housing associations puts homes within the reach of the many people who would otherwise be unable to afford them. It’s high time for a change in Government policy to support greater flexibility to deliver not just on homes for sale, but also allowing more to be built to rent,’ he concluded.[1]

[1] http://www.propertywire.com/news/europe/uk-new-homes-rent-2016072712189.html

Almost Half of Over-45s See Property as Key to Their Retirement Income Plans

Published On: July 27, 2016 at 8:52 am

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Long-term house price growth and attachment to homes means that almost half of over-45s consider property as key to their retirement income plans, according to the latest Aviva Real Retirement Report.

The study found that 46% of over-45 homeowners – 6.08m UK households – see the wealth built up in their property as a key part of their retirement income plans, rising to 58% among the youngest age group (45-54). A generational shift in attitudes also means that this group are almost as likely to consider property wealth as part of their retirement income plans as their inheritance plans (60%).

However, with many over-45 homeowners pressured by existing mortgage debt, a desire to help their children get onto the property ladder, and concerns over making their money last in later life, the report asks: Are there enough homes to go around?

Mortgage freedom

Aviva found that almost one in four (23%) mortgaged over-45s are worried about paying off their property loans, including 8% who are very worried. This suggests that as many as 1.02m over-45s in the UK are worried about becoming mortgage free, with those who are very worried totalling 354,201.

With an average balance of £85,634, these homeowners carry an outstanding mortgage debt of £87.2 billion – equivalent to 7% of the UK’s £1.29 trillion mortgage debt.

One in three (33%) mortgaged over-45s do not expect to pay off their loans before passing the old Default Retirement Age of 65, while a further 17% do not know when they will become mortgage free. Worryingly, another 4% think that they will never pay off their mortgage – equivalent to 177,101 UK households.

Emotional attachment to property

Despite this mortgage pressure, Aviva’s report shows that almost seven in ten (69%) over-45 homeowners say their home is worth more than their pensions, savings and investments combined. With an average house price of £264,402 for this group – 27% more than the UK average of £209,000 – even those who still have mortgage debt are likely to have significant equity built up in their property.

Beyond financial concerns, many over-45s have also developed a strong attachment to their home. The average over-45 homeowner has owned just three properties in their life and has lived in their current home for 21 years.

When asked about their plans for retirement, four in five (80%) want to remain living in their current home for as long as they are physically able to. Comparatively, just 26% have either downsized already or plan to do so in the future. It is believed that if the older generations downsize their homes, the housing crisis could be solved.

Almost Half of Over-45s See Property as Key to Their Retirement Income Plans

Almost Half of Over-45s See Property as Key to Their Retirement Income Plans

The most common reasons for wanting to stay put are because homeowners are happy or content (31%), value their independence (26%), or feel they live in a convenient and safe neighbourhood (12%). Interestingly, the most common motive for downsizing is to find a home that is easier to maintain (41%), rather than financial reasons.

Borrowing in retirement 

The Real Retirement Report suggests that a significant number of over-45 homeowners will need to borrow in retirement if they wish to stay in their current home. One in six (16%) expect they will need to keep borrowing or borrow again in retirement – equivalent to 2.12m households. More than half of these – 1.19m – will rely on their ability to borrow to remain in their homes.

More than 1m expect to need to borrow in retirement to meet daily living costs, while 1.72m believe they will need access to retirement lending to meet one-off expenses.

Demands on property wealth

More than half (52%) of over-45 homeowners feel they could benefit from using their property as an extra source of retirement income. However, significantly more of those in the 45-54 category (69%) feel this way than over-75s (39%).

Meanwhile, over-45s have other uses in mind for their property wealth. More than half (56%) believe it could pay for care in later life, while the same number feel their quality of life would benefit from using it to pay for home adaptations.

Additionally, 61% see property wealth as a key part of their inheritance planning. However, with younger generations facing a challenge to get onto the property ladder themselves, another shift may be occurring: 54% of over-45 homeowners would prefer to give money while they are still alive – a living inheritance – to help a family member buy their first home, rather than leave a traditional inheritance. Just 34% say the opposite.

Helping first time buyers 

Almost one in three (31%) over-45 homeowners have already or plan to give money to help their child buy their first home, making an average contribution of £25,090. Most of those who provide financial support use their savings and investment income to do so, either to pay for a deposit (71%) or buy a property outright (10%).

However, an over-45s’ ability to help is often constrained by their own finances. Despite 43% believing that younger relatives will never own their own homes without family support, almost two in five (37%) would like to help their children get onto the property ladder, but can’t afford to.

Over half (52%) do not feel comfortable giving financial support without knowing how much money they will need themselves in later life. The report concludes that making their money last long enough is people’s greatest concern in retirement.

The trend towards helping younger family members may mean in turn that more over-45s need to use their own property wealth in retirement, either as an alternative way to provide a living inheritance, or to boost their retirement income as their savings are depleted.

The Managing Director of Retirement Solutions at Aviva UK Life, Clive Bolton, comments on the findings: “Pension freedoms have resulted in new decisions for people to make about how they use their life savings, and these findings suggest we are also starting to see a shift in attitudes towards wider use of property to help fund retirement, as well as providing a place to live. Property assets more than match pension wealth for many older homeowners, so it is sensible to consider bricks and mortar among the options to supplement their savings.

“However, later life brings a host of financial challenges and pressure points, which suggest it would be wise not to place all retirement bets on the house. The equity build up in people’s homes sounds like a lot, but considering that many can be retired for 20 years or more and often want to help their families as well as themselves, it’s easy to overestimate how far that money will take them. People need to consider if there are enough houses to go around and build this into their retirement plans alongside their other assets.”

He continues: “As well as boosting day-to-day funds, people also earmark their property wealth to help pay for care, leave an inheritance and help younger generations onto the housing ladder. There are also widespread worries about paying off mortgages to address in later life, along with a general desire to avoid needing to move from the place they call home.”